Defense ensures investment greater than works, Education and Health

While the space for investments in the federal government budget shrinks year by year, the Ministry of Defense has managed to circumvent the cuts and even increase its share of these expenses, gaining priority in relation to areas such as health, education and infrastructure.

In 2022, Defense has a reserve of BRL 8.7 billion for investments, equivalent to 20.7% of the BRL 42.3 billion authorized for this year.

In practice, for every BRL 5 allocated to this type of expenditure, BRL 1 is stamped for the military area. This share was 14.2% in 2015 and has been growing since then.

The value of Defense exceeds the sum of allocations to the Ministries of Health (R$ 4.6 billion) and Education (R$ 3.45 billion), which both had a real drop of around 3% compared to last year.

The allocation of the portfolio is also greater than the resources approved for works and acquisition of equipment by Regional Development (R$ 7.5 billion) and Infrastructure (R$ 6.5 billion).

The investments of these two portfolios include maintenance and opening of roads, water security works, basic sanitation, social housing and urban mobility.

The values ​​by ministry were collected by the IFI (Independent Fiscal Institution) of the Senate at the request of the leaf and they already include the resources indicated by parliamentary amendments —which are pulverized according to the local interests of congressmen.

Accounting for financial investments, another type of investment that includes contributions to financing funds or the acquisition of assets that are already in use by the government, would raise the total amount to R$ 47.3 billion, but would not change the situation between ministries.

The distribution of investments generates criticism from experts, especially at a time when the country is still recovering from the effects of the Covid-19 pandemic and should direct efforts to areas that have had their deficiencies tested by the health crisis.

The infrastructure area faces historic bottlenecks. The investments planned for the maintenance, construction and adaptation of highways in 2022 are equivalent to only one third of what would be necessary, according to calculations by the Inter.B consultancy commissioned by the CNI (National Confederation of Industry).

Economic sources estimate that the military has a good track record of executing projects, but also enjoys greater sympathy from President Jair Bolsonaro (PL). Representatives of the military group also approached Bolsonarism and the political game of the Chief Executive.

In the Budget, some of the actions programmed by Defense include the acquisition of military freighters, border monitoring systems and development of the Navy’s nuclear technology systems.

Sought, the folder did not manifest itself until the publication of this text.

UFRJ (Federal University of Rio de Janeiro) professor Ligia Bahia, a specialist in collective health, warns that the pandemic highlights the need to invest in infrastructure to deal with health emergencies and develop vaccines and tests.

“It is not just research, but physical plants, modernization of hospitals, the entire network of outpatient care, testing, telemedicine, technological investments, robot surgery. It is a set of investments that is knocking at our doors”, says Bahia.

“It’s completely scary. Is Defense more important than health? We have defense against the enemy, but don’t we have defense of our health?”, asks the teacher.

The executive director of the IFI, Felipe Salto, says that the picture of public investments is worrying because they are already at historically low levels. Even considering all federal, state, municipal and state expenditures, Brazilian public investment is 1.7% of GDP (Gross Domestic Product).

The level is well below the average of 3% of GDP observed among OECD (Organization for Economic Cooperation and Development) countries, the “club of rich countries” of which Brazil aspires to be a part.

“In OECD countries, the two biggest areas of investment are education and economic affairs and transport. This accounts for 60%”, says Salto, recognizing that Defense investments are concentrated at the federal level, while education and health receive reinforcements from states and counties.

“If we want to have a recovery in economic growth, either we increase and improve the quality of investments, or we keep skating”, he says.

Economist Claudio Frischtak, president of the consultancy Inter.B, believes that the spending cap — a rule that limits the advance of expenses to inflation — exposed the scenario of scarcity of resources, and investments have become a preferred target because they are easy to cut and difficult to execute.

“Within this residue, which we will call investment, this government in particular introduced a peculiar tendency to please what it believes to be an important base for it, the Armed Forces”, says Frischtak.

“This makes no sense, as it seems to me that the social rate of return on investments in infrastructure, when well executed, tends to be higher than that of these alternative investments”, adds the economist.

The president of Inter.B recognizes that Brazil has a series of gaps in the cost-benefit analysis of public investments, but believes that this practice should be encouraged in order to establish priorities based on technical bases.

The professor of IFRS (Federal Institute of Rio Grande do Sul) Gregório Grisa, PhD in Education, says that investment in education would be an application of resources with high returns, in addition to being progressive, as it benefits lower-income citizens more.

“Investment in public education is extremely progressive, it has a high rate of social return for the poorest”, he says.

However, the low level of investment in public education compromises not only this development, but also the achievement of the goals of the PNE (National Education Plan), which deal with the expansion of enrollment rates in technical and higher education.

“The current level of investment makes any type of expansion of federal institutes and universities unfeasible, compromising the purchase of equipment and supplies for laboratories, collections”, he criticizes.

In basic education, according to Grisa, the major bottleneck is the expansion of full-time education. “States and municipalities do not have the capacity to build buildings. There is a dependence on the Union to have investments for new daycare centers”, she says.

In addition to criticizing the distribution of investments between ministries, experts also warn of the inefficiencies of concentrating these expenses in the hands of congressmen through the amendments.

This year, investment amendments total R$ 17 billion, or 40% of the total. Although they are still investments, they are pulverized expenses, which hardly finance structuring works. Therefore, they are considered to be of low efficiency.

“We really need investment, [dinheiro] that can create something new, because parliamentary amendments do not have that power. The amendments are parochial, for things that already exist”, says professor Ligia Bahia.

as showed the leaf Last year, Defense executed BRL 8.1 billion in 2020 in investments, the lowest level in a decade.

Personnel expenses account for the largest share of annual military spending, accounting for more than 70% of the total. Last year, they accounted for 79.6% of the portfolio’s budget.